Property price insight from Rics - buy to let mortgages

10 July 2009

An ongoing lack of finances for borrowers looking to take out buy to let mortgages and other products is likely to mean that house prices will continue to remain subdued for some time.

That is according to the Royal Institution of Chartered Surveyors (Rics), which has taken the latest data on the UK property market published by the Halifax as support for its view that it is still too early to say that the worst is over for house prices.

According to the lender, house prices dropped by an average of 0.5 per cent in June after the increase seen in May, indicating that demand is still relatively low, thanks to a variety of factors.

Rics chief economist Simon Rubinsohn commented: "The continuing weakness in the [Halifax data] provides a timely reminder that despite the better newsflow emerging from the housing market it is far from clear that prices have bottomed.

"The combination of further job losses and a continuing lack of mortgage finance remain major headwinds for the market."

On a more positive note, Halifax also reported that low interest rates and improvements in affordability have helped to stimulate demand for mortgage products over the past couple of months.

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